While continuing fallout from the pandemic and the industry-wide chip shortage are a blow to automakers globally, they are hitting Nissan at a particularly difficult time.
The company is a year and a half into a revival plan that hinges on cutting costs and capacity and improving profitability of sales with 12 new vehicles the automaker intends to bring to market.
Nissan lowered its global sales target to 3.8 million vehicles from a previous forecast of 4.4 million.
The company’s vehicle sales fell each month in the July-September quarter from a year earlier, but volume is up 4.1 percent this fiscal year through September. Global production is up 3 percent from a year earlier.
Parts shortages are causing delays in Nissan’s rollout of new models such as its Ariya full-electric crossover.
The company warned earlier this year it is expecting to lose about 500,000 units of production this fiscal year due to the ongoing chip shortage.
As of July, Nissan was aiming to recover around half of that lost output in the second half. But since then, Nissan, like other Japanese automakers, has been “greatly impacted” by shortages of other automotive parts as well, CEO Officer Makoto Uchida said in a recent interview.
Resilient U.S. demand
At the same time, production cutbacks paired with resilient demand for cars in core markets such as the U.S. are helping to bolster Nissan’s profit margins, along with a weaker yen that is boosting profits brought back home.
With supply unable to keep up with demand, incentives are falling, and used-car prices are skyrocketing.
Cost-cutting efforts are also helping offset losses elsewhere and Nissan is on track this year to reach the 2 percent operating profit margin target it laid out in its turnaround plan, Uchida said in September.
Reuters and Bloomberg contributed to this report
